A recent report reveals that Canadians are facing challenges in meeting their mortgage obligations, particularly in the expensive housing markets of Ontario and British Columbia. Equifax Canada’s Market Pulse report, released on Tuesday, indicates a 32% increase in national mortgage delinquency balances in the first quarter compared to the same period last year. Ontario and British Columbia saw even higher spikes at 52% and 36%, respectively.
According to Equifax Canada, the rise in missed payments underscores significant financial stress in these pricey markets. Homeowners who missed payments had an average delinquent non-mortgage balance of $54,000, a 4.6% rise from the previous year. Additionally, the average delinquent mortgage balance surged by 13.2% to $355,500 during the quarter.
The report also highlights an 11% increase in homeowner insolvencies compared to the fourth quarter of 2025, with insolvent mortgage holders carrying an average non-mortgage debt of $82,400. The majority of these individuals opted for consumer proposals over bankruptcy, accounting for over 90% of cases.
Despite the uptick in delinquency balances, the rate of missed mortgage payments exceeding 90 days stands at a low 0.22%, below pre-pandemic levels. Rebecca Oakes, Equifax Canada’s vice-president of advanced analytics, emphasized that while missed mortgage payments are relatively rare, they offer insights into underlying financial pressures.
Oakes attributed the challenges to higher interest rates affecting homeowners’ ability to meet payment obligations. As interest rates have increased, homeowners renewing their mortgages at higher rates have experienced difficulties, leading to a rise in missed payments in recent years.
While Ontario and British Columbia have seen surges in missed payment levels, provinces like Quebec and Saskatchewan have witnessed declines in delinquencies. However, Oakes warns that delinquencies may rise as mortgages come up for renewal at higher rates in the future.
The report indicates that overall insolvency volumes have reached their highest point since 2009, with an 18.8% year-over-year increase in insolvencies in the first quarter of 2026. Despite Canadians displaying financial discipline to navigate economic challenges, systemic risks persist.
Ron Butler, principal broker at Butler Mortgage and host of the Angry Mortgage podcast, attributes the increase in delinquencies to a “perfect storm” of factors, including declining home values, higher interest rates, and a challenging job market. He emphasized that individuals who purchased homes between 2020 and 2022 in Ontario are facing decreased property values, exacerbating financial struggles.
Butler also highlighted the impact of job losses and reduced earnings on mortgage delinquencies, particularly among housing investors. These investors, who relied on rental income from international students, faced difficulties as student numbers declined, as seen in Brampton, Ontario.
Despite the rise in delinquencies, financial institutions are not alarmed yet, as the current trend remains manageable for banks, according to Butler.
